Megan McArdle

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Power to the people, Part II

13 Nov 2007 03:05 pm

Being in Vietnam makes visible the conflict that we're facing over global warming. Ordinary lifestyles here are very low-energy. Especially outside of Ho Chi Minh City, the primary mode of transport is the scooter, bicycle, or farm animal. Electrification has reached most, but not all, of the country, and few people can afford the panoply of appliances that make American lifestyles so energy intensive. I've flown into two cities at night now, and both times, the surprising fact is how dim they look from the sky.

But making their lives more energy intensive means burning more fossil fuels. Particularly in the early stages of development, it means burning nasty, polluting, carbon-emitting anthracite coal, which Vietnam not only uses for its own electricity, but increasingly exports to China. Vietnam has just about as many people in it as Germany, emitting a fraction of the carbon. Even if Germany cut its emissions in half, or more, it would not make up for Vietnam's industrialization.

I saw a farmer today peddling a cow to market in a trailer attached to his bicycle. This engendered considerable confusion--on my family's farms, the principle has always been that the animals expend energy to move you around, not vice versa. But it also speaks volumes as to just how much more energy the Vietnamese people could stand to consume.

Comments (21)

"on my family's farms, the principle has always been that the animals expend energy to move you around, not vice versa"

If he's taking it to be slaughtered, the walk will decrease the weight of the animal, thus reducing his profit. Which is why in modern factory agriculture animals are permitted to move around very little, if at all. Get 'em fat and get 'em out is the name of the game.

Peter.Bautista

My understanding, though, is that some countries consume far more energy per capita than others, even among the industrialized countries. For instance, the US consumes far more per capita than Germany.

I don't actually have the figures, though, so it's possible I'm wrong.

If it is true, though, then it matters which countries reduce their consumption while countries like Vietnam increase theirs. If Vietnam increases consumption to half of Germany's per capita, while the US reduces its consumption, I can see how we might be able to avoid catastrophe without insisting that the third world remain third world.

But I've never really gotten too involved in these climate debates, so this is just a standard blog-post comment, not an educated opinion.

I'm very interested in Vietnam. I hope you will write about giving people in Vietnam clear title to their land (shades of de Soto).

After reading Kenneth Pound's book on investing in Vietnam, and a research report on the country, I bought Luks Group (LKSGF in the US), a HK-based company with heavy investments in Vietnam. I also bought a closed-end fund, Vietnam Opportunity Fund (VTOPF in the US). It cost me an extra $75 per trade to settle the transactions, but I think it's worth it.

Vietnam really could be China in the early 80's. Now if they can only avoid a 6/4 type incident...

Peter Bautista wrote: My understanding, though, is that some countries consume far more energy per capita than others, even among the industrialized countries. For instance, the US consumes far more per capita than Germany.

Problem is, more and better economic activity invariably equates to higher energy use. Ceteris parabus, a stronger economy will consume more energy. Hence, in a strong economy one of the dominant factors in energy use per-capita is productivity. Other measurement inputs are required in order to discern what portion of that figure might be waste and inefficiency.

People need to ditch the belief that, oh, if we just increase efficiency enough, or ban just the right wasteful technologies, the world fossil fuel consumption will stabilize. The focus should be on making fossil fuels' price incorporate the damage they use, so that any use is tolerable, and no one has to be begged to "unilaterally disarm".

The cost of energy is inversely proportional to the amount one sweats. The more you sweat, the less productive you are. (i.e. you're poorest when you are only working for yourself and are totally dependent on your own outputs, vice you're richest when your work product is used by everyone, and you are supplied by everyone).

The amount of energy used is less important than the outputs derived from same. Given the U.S. advantage (production/productivity) in efficiency at creating goods and return on investment from a given input of energy, most (if not all) of the rest of the world should send us their Ergs. A fact derived from this observation is that the most wasteful and dangerous use of energy is someone reading by the light an oil-lamp (sigh. I donate to http://www.self.org)

Do we know for a fact that free enterprise by a free people is the surest escape from poverty? Counter examples? Property rights, civil society (including fast redress of complaints), and a minimum of non-discriminatory law and regulation (irrespective of political freedom) appear to be the minimum subset, but, as seen in the amount of intellect wasted moving cows in Vietnam, an order of magnitude drop in the cost of energy would provide them a big boost. If you believe that only the rare genius will save us from nature or man-made catastrophe (including personal disasters - like not my getting another ten pain free years of life expectancy because "we" decide that the creative destruction to accomplish this and other wonders is just too painful - and upsetting to the guilds and special interests), it's hard to justify chaining these people to hard physical labor if the cost of freeing them is even the worst of the global-warming histrionics. And the Vietnamese I've worked with in Silicon Valley and other places are some of the most able, smartest, hardworking people I know. Note that every time China picked a fight with Vietnam, Vietnam embarrassed them terribly (maybe that won't happen now that China has a large amount of economic freedom, but in the past…).

Consider that France's use of standardized (identical copies) nuclear power plants managed by operators who are members of a government service similar to our own Navy's submarine nuclear engineers means they have built gigawatt generating plants for as little as $200M each (with no meaningful protest from pressure groups that caused the U.S. to raise construction costs by 10x due to regulation). Électricité de France's (EDF) is able to product a KWH for under a quarter of a penny (and charge 10+ cents for it, both locally and the 50% that is exported to the rest of Europe). Granted, EDF has its own issues with the soft (and hard) corruption of a state-run company that dissipates most of these benefits (hard to believe they need 150K+ employees to operate less than 80 plants and the nationwide power distribution system. Local services are managed by the state gas company).

The amount of energy used is less important than the outputs derived from same. Given the U.S. advantage (production/productivity) in efficiency at creating goods and return on investment from a given input of energy, most (if not all) of the rest of the world should send us their Ergs.

Transportation use in the US is extremely energy-inefficient, due to sprawling patterns of settlement and reliance on automobiles. Vietnamese transit development is likely to look much more like Japan's or the Netherland's for the simple reason that Vietnam is geographically more like those countries: extremely dense settlement on scarce, intensively cultivated agricultural land. There is literally no physical way to turn most of Hanoi into a car-based city; most roads are narrower than US regulations for a standard 2 lanes, and they must accommodate cars, motorbikes, bicycles and pedestrians. (Sidewalks are largely parked-in with motorbikes.) Ho Chi Minh City is more car-based because it was developed on French and American lines in the '60s and '70s, with wide avenues. Danang, too. But in even the medium run most Vietnamese cities are physically incapable of handling large numbers of cars. The eminent-domain issues involved in bulldozing wider roads are at least as complicated as those involved in building public transit systems.

Vietnam is headed towards trains and mass transit by the simple logic of population density. Right now, the roads are already hitting overload -- and that's with the vast majority of people riding motorbikes. You don't know the meaning of gridlock until you've seen a six-lane road paralyzed from storefront to storefront with motorbikes, right up onto the sidewalk.

Also, there's a tentative agreement to build a couple of nuclear plants by 2020 -- a Japanese firm, I think, probably using Westinghouse designs. Which is positive. Air quality in Hanoi stinks.

Among coals, anthracite is actually about the nicest, lowest in sulfur, etc. Brown coal is the worst. Not that 'coal' is a great neighborhood to be in.

It's not a certainty that Vietnam and similarly situated countries will go down our fossil-fuel-intensive path. Depending on the pace of their development vs. the pace of development of alternative technologies, they might leapfrog us because they have no cultural affinity to, or vested interests in, producing energy a certain way.

Most third-world countries with any degree of economic dynamism, for instance, have leapfrogged landline telephones in favor of cell phones, thus saving infrastructure costs.

re: U.S. transportation is "inefficient"

Only if you're willing to ignore are demonstrated ability to out-produce, exceed all other's ROI for a given input of Ergs in a GDP.

I maintain that the invisible hand with low regulation (well, low relative to others) has delivered as optimal a transportation solution as can be. If only because time waiting on group transportation, coordinating travel with others and walking or biking is nearly always unproductive time. The reasons the very wealthy and powerful have drivers at their beck and call is because it's clear that for them time-is-money. It's only the misinformed and socialists that will deny this perq to the commoner.

People sometimes hold up Japan as a model to follow. Yes, we could hide the U.S. population in the Grand Canyon at Manhattan or Tokyo densities (with room to spare and transportation to match). And only heat our living rooms (don't ask). But if it didn't evolve in a market setting (a free people and their enterprise), we'd suffer the hit on our productivity (and first world standing).

Be great if we had a democracy at a level that would let us vote on an issue like this, v. having it dictated by courts and (near unitary :-) agencies.

For reasons that should be obvious, one of my favorite countries, Canada, is the largest per capita user of energy in the world (at least among major countries).

It drives me crazy that this point isn't raised more in the global warming debates. Even maintaining current levels of emissions means asking huge portions of the world's population to remain in poverty. Every productivity enhancing tool requires energy. The developing world may be able to develop in a more energy efficient manner that we did, but the idea that they could reach a living standard that is 1/4 of ours without massive increases in energy use seems unrealistically optimistic.

The "stop all growth of emissions" crowd could learn a lesson or two from Paul Ehrlich's famous wager regarding the cost of some selected basic commodities. Paul Ehrlich believed that population growth would doom mankind, famines would erupt and lifestyles would decline due to ever increasing consumption of basic resources. Of course, he was proven totally wrong in the bet as prices of all of his chosen commodities fell. And he was also proven totally wrong on his primary assumption as the World's standard of living has increased dramatically since he placed the bet.

Humans (and markets) are incredibly adaptable and can accomodate pretty dramatic changes in the environment. What's the likelihood that the costs caused from global warming are greater than the cost of trying to stop it? Especially since just stopping the growth of emissions is not enough? There seem to be a lot of people saying that "no cost is too great", but I think those people think that global warming can be stopped if everyone just buys a Prius.

OK, you want to address the consequences of global warming for the Vietnamese? The entire Mekong Delta, home to 20% of the country's population and a much larger percentage of its wealth (agriculture and industry), is 1 meter above sea level. Without action on global warming, the whole thing will go under by early next century. It's crisscrossed by canals and mangrove swamps; putting a dike around it would be like putting a dike around Florida. The losses in real estate, and in public investment (roads, bridges, ports), will be catastrophic.

Obviously there's nothing the Vietnamese can do to stop it. It can only be stopped by the whole world together -- us, the Europeans, the Chinese and the Indians. Maybe even that won't be enough. But if you're talking about something you can do to help Vietnam get rich, "not stopping global warming" is really not on the list. It belongs in the "destroy their real estate" category.

Hmmmmm.

Global warming?

What utter nonsense. The entire silly business is based on computer models that are run until their iterations achieve the insensible.

Here's a clue: If you can't predict the weather two weeks out, then you cannot predict the weather 100 years from now.

And the simple answer is that you cannot, under any circumstances, predict the weather two weeks out even using the most powerful supercomputers.

Consider the difference in knowledge now vs a few years ago:

1. Plant trees. The assumed Common Wisdom v Global Warming (CWvGW) was that planting trees was a penultimate solution. Then it turns out that trees emit carbon dioxides and thus contribute to Global Warming and aren't the beautiful solution they seemed to be.

2. High altitude clouds have a dramatic impact on heat retention by the Earth. Only thing is that we didn't know then that cosmic rays from the sun ionize the upper atmosphere and help form high altitude clouds.

I.e. more solar activity = more clouds.

Which has absolutely nothing to do with human activity except perhaps Aztec like human sacrifices to the Sun gods.

3. Or how about the more recent discovery that high altitude clouds are also impacted by higher temperatures in that the higher the temperature the fewer the high altitude clouds created, thus increasing the heat loss.

...

The simple fact is that the planet Earth has been a sufficiently organized closed system for the better part of 2+ billion years now. If it were possible for the Earth to become an uninhabited hellhole simply because a couple percentage points more of carbon dioxide was dumped into the atmosphere then the planet would've turned into hellhole hundreds of millions of years ago when vulcanoes were much more in evidence.

The reality is that Global Warming is nothing more than an excuse to screw over America and the rest of the West because some people don't have the balls to actually live in a low-energy lifestyle just as in the past the ultra-liberal Western communists liked living in the West rather than in the rat infested concrete warrens of the Communist countries.

While some people may be willing to cut these people slack, I'm not. In the past you could be a cafe communist and not get called on it but those heady days of rapture are past. As one who spent his childhood living on his maternal grandparent's rice farm in South Korea during the 1960's and who HAS lived the low energy lifestyle ...

Take my word for it, it sucks donkey ass.

You want to do something about something as contrived as Global Warming? Then impress me and try living as your great-grandparents did in the 1880's or 1890's.

Yeah. That'll last.

My question is: Why are you still hawking this "global warming" baloney? memomachine has it exactly right. Furthermore, the hysteria emanating from POLITICIANS leads me to believe that there is an ulterior motive, as in, "More power for politicians!" No event that takes place over 50 or 100 years is a "catastrphe that humanity might not survive." It is merely a gradual change in conditions that we will adapt to. Get over it, people!

Earnest Iconoclast

I wonder how the Vietnamese would vote if offered a choice between living their current lifestyle in their current location or having access to modern US amenities and technology but having to move.

EI

EI, I wonder how exactly you plan to get them "modern US amenities and technologies". Currently they are earning those things through their exports to the US, Europe and Japan. What do those exports include? Vietnam is the world's second-largest exporter of rice; the most fertile fields and the majority of the industry are in the Mekong Delta. These fields already face increased salinity related to rising sea levels. Vietnam has a multibillion-dollar aquaculture industry, largely in the delta and all on low-lying land, which faces the same increased salinity problem; also, rising sea levels back up the Mekong's freshwater flow into an estuary, making it harder to flush out pollutants that kill fish and shrimp. Much of Vietnam's garment and electronics industries are in low-lying areas of the South, and most of the port facilities that get the goods to the West. These are the territories that will be underwater in 100 years.

Look at the geography. Vietnam is a country divided into a wealthy, flat rice-growing plain, much of which is 3 meters or less above sea level, and stark, sparsely inhabited mountains. All of the country's population and wealth is in the plain. A one-meter rise in sea levels would have the Pacific lapping at Saigon. The World Bank calculates that Vietnam and Bangladesh are the two developing countries which will be hardest hit by rising sea levels. Economic growth is not something that just happens magically as long as one is allowed to burn as much fossil fuel as possible. When storm surges kill increasing numbers of one's citizens, destroy property and infrastructure, it has a negative effect on prosperity. Would you invest in New Orleans?

"What utter nonsense. The entire silly business is based on computer models that are run until their iterations achieve the insensible.

Here's a clue: If you can't predict the weather two weeks out, then you cannot predict the weather 100 years from now."

Wow. You know anything about the climate models? Any thing besides what what talk radio tells you. What specific problems with what specific model do you have?

You clearly don't shite about climatology (as evidenced by your confusion of weather and climate)

"If it were possible for the Earth to become an uninhabited hellhole simply because a couple percentage points more of carbon dioxide was dumped into the atmosphere then the planet would've turned into hellhole hundreds of millions of years ago when vulcanoes were much more in evidence."

Actually most people that understand global climate change and help build the computers models aren't claiming it's going to become an uninhabited hell hole - just that it's going to be highly disruptive to large portions of humanity.

Sorry but the claim that climate scientists are a bunch of communists trying to destroy our lifestyle is nonsensical. I spent a couple of years looking into the issue - including running the a couple of climate models on a small (25 machine) supercomputer cluster I owned. I tend to think the models are on to something so I made adjustments to my real estate portfolio. Great thing is - we are going to know very soon whether it's true or not.

Earnest Iconoclast

brooksfoe, I don't plan on providing anything to Vietnam. My gross personal product isn't enough to matter. However, I also don't want to have my country pressuring them into maintaining their current per capita carbon footprint. Whatever happens, I doubt they'll be able to improve their lives without increasing their per capita carbon footprint.

EI

memomachine rants: "Here's a clue: If you can't predict the weather two weeks out, then you cannot predict the weather 100 years from now.

And the simple answer is that you cannot, under any circumstances, predict the weather two weeks out even using the most powerful supercomputers."

Say what? I can most certainly predict that the average weather two weeks from now in Chicago will be x degrees colder than today, with the distribution of temperatures around x. I can do the same with rainfall, cloud cover, and a bunch of other things about weather.

I can do the same for Miami and predict that there's a y% chance that Miami will be warmer than Chicago two weeks from today.

You are committing the fallacy of saying that because there is insufficient prediction of an individual instance, that the aggregate cannot be predicted.

Another example: I can't predict whether you will buy a new car two weeks from today, but I can decently predict the total car market.

Climate is complex and the models we have now will likely look primitive in 20 years, but that doesn't mean they are useless.

Only if you're willing to ignore our demonstrated ability to out-produce, exceed all other's ROI for a given input of Ergs in a GDP.

Ari Tai, you're saying the opposite of what I thought was true. I thought the United States used more energy per dollar of GDP than most other countries, Europe included. See the chart in the Wikipedia article on Energy Intensity. On that chart, it looks like we're barely more energy efficient than China. (Of course, I don't know anything about the numbers that went into that chart.)

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